Economy Round-Up

ET Bureau|

Nov 29, 2009, 12.26 AM IST

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Special panel to settle MNC tax rows

Multinational companies can now look forward to settling their tax disputes expeditiously in India. The Central Board of Direct Taxes on Monday announced the new rules for creation of special dispute resolution panels (DRP) that will allow foreign taxpayers to sort out disputes in a faster and cost-effective manner. However, the new mechanism can be resorted to by a foreign company only if it has a dispute with tax authorities regarding transfer pricing, which refers to tax disputes pertaining to pricing of tangible and non-tangible assets transferred within an organisation.

A foreign company facing a dispute pertaining to corporate tax in India along with a transfer pricing would also be able to avail of this window. There would be eight DRPs across the country in eight cities, including Delhi, Mumbai, Chennai, Kolkata, Bangalore, Pune and Hyderabad.

Food inflation soars to 15.6%

The annual rate of inflation for food articles, as measured by the wholesale price index (WPI) rose to 15.6% for the week ended November 14 from the previous week’s 14.6%, as price of pulses and vegetables increased sharply during the week, data released on Tuesday showed. The overall wholesale price index for food articles was up 1.6% during the course of the week.

Core sector clocks 3.5% growth

Key infrastructure industries that account for over a quarter of the country’s industrial production grew a modest 3.5% in October 2009, the lowest in three months, indicating possibly a lower overall industrial growth for the month. Industrial production had grown 9.1% in September 2009 when core sector growth was somewhat better at 4.1%. In August 2009, industrial production was up 11% as the core sector had pitched in with a 7.8% growth. Despite the moderate core sector growth, economists are confident of a sustained recovery in the coming months.